Top tips on preparing for EU trademark reform

On March 23, 2016 the new EU trademark regulation (Regulation [EU] No. 2015/2424) will come into force. Together with the new trademark directive (Directive [EU] 2015/2436), the regulation is the biggest change to European trademark law in the last 20 years. Brand owners should already be acting to get ready for the new rules.

Tip 1: Amend specifications of EU trademarks before March 23

This is the single most important thing for brand owners to do, and it needs to be done fast—before March 23.

The regulation provides that all Community trademarks (CTMs), now called European Union trademarks (EUTMs), filed before June 22, 2012 covering all terms of a class heading in a specific class (or the class headings plus additional goods/services) will have their scope of protection reduced to the literal meaning of those terms.

That is, unless a declaration is filed in a six-month sunset period after the regulation enters into force stating that the owner’s intention was to seek protection for certain goods/services included in the version of the Nice Agreement’s alphabetical list in place when the CTM was filed.

If no declaration is filed during the sunset period, those EUTMs will be deemed to cover only the goods/services covered by the literal meaning of the relevant class heading. Depending on the class, this could result in a significant reduction of the scope of protection of EUTMs.

In addition, under the new law, even if you do file a declaration during the sunset period, you won’t be able to prevent a third party from continuing to use a trademark in relation to goods/services where and to the extent that:

· The use of the trademark for those goods/services commenced before the register was amended; and

· The use of the trademark in relation to those goods/services did not infringe the proprietor’s rights based on the literal meaning of the record of the goods and services in the register at that time.

The same limitations apply in the event you decide to file an opposition or invalidity action against a later trademark.

The Office for Harmonization in the Internal Market, now called the European Union Intellectual Property Office (EUIPO), has issued a president’s communication concerning the implementation of article 28 of the regulation which makes it clear that any declarations made under that provision will have to be extremely narrow. It has also compiled a list of examples of goods and services which it considers to go beyond the literal meaning, which again is very narrow.

It remains to be seen to what extent the EUIPO will be lenient in accepting claims to additional terms beyond this list. The problem is that even if it is lenient, there will undoubtedly be differences in the approach to literal meaning taken by the EUIPO and national judges in the 28 member states when deciding on the enforcement of EUTMs or future counterclaims for revocation. Therefore, filing declarations under article 28 of the regulation is both difficult and uncertain.

“Wine makers can probably accept the deletion of curacao liqueur in class 33, and software companies can presumably accept the removal of asbestos screens for firemen in class 9.”

Brand owners have four options:

1. Do nothing, and potentially have the scope of protection of their EUTMs severely limited;

2. File a declaration under article 28 of the regulation within the six-month sunset period, in which case the scope of the goods and services will be severely limited and the third-party defences under article 28(8)(a) will apply;

3. File a partial surrender during the six-month sunset period by amending the specification to list all of the relevant goods/services in the relevant alphabetical list with the exception of one—this will allow broad specifications, but probably means that the third party defences under article 28(8)(a) will apply; or

4. File a partial surrender before the regulation comes into force by amending the specification to list all of the relevant goods/services in the relevant alphabetical list with the exception of one—this will allow very broad specifications and avoid the application of the third party defences under article 28(8)(a).

Option 4 will clearly be preferable for most brand owners, allowing the broadest possible scope of protection and avoiding possible third-party defences. The need to delete one good or service from each class sounds negative at first glance, but on closer examination it is usually not. Telecommunications companies can usually live without coverage for the sending of telegrams in class 38, wine makers can probably accept the deletion of curacao liqueur in class 33, and software companies can presumably accept the removal of asbestos screens for firemen in class 9.

Tip 2: File multi-class marks before March 23

The regulation introduces a new single class fee structure for EUTMs, rather than the current ‘three for the price of one’ model.

Generally, fees have gone down, but if you have large multi-class filings on the horizon you should file them before March 23, 2016. The fees for filing applications in more than three classes will go up, in some cases significantly.

Tip 3: Go ahead and renew, but select the right option

The situation regarding renewals of EUTMs in 2016 was unclear, but it has now been clarified. The EUIPO has confirmed that:

·  The current (old) regulation will apply to EUTMs due to expire on March 22, 2016 or before; and

·  The new regulation and the new reduced renewal fees will apply to EUTMs due to expire on March 23, 2016 or later.

Brand owners can now proceed to renew their EUTMs that are due for renewal in 2016. However, for EUTMs that expire on March 23, 2016 or later, it is important to select the “debit on expiry” payment option so that the EUIPO doesn’t deduct the current higher renewal fee.

Tip 4: Docket the right date for renewal payment

Under the old regulation, renewal fees did not have to be paid until the last day of the month in which the EUTM was set to expire—for example, the fee to renew an EUTM set to expire on September 2 wasn’t due until September 30. The new regulation states that renewal fees are due on the day the EUTM expires.

Brand owners therefore need to be careful to docket the right date for renewal payments to avoid having to pay for filing renewals late.

Tip 5: Think about re-filing

The new trademark directive will introduce the ability to seek proof of use in all actions in all EU member states, including infringement, oppositions and cancellations. This means that brand owners will face the time-consuming and expensive task of proving use more often. Surprisingly—in view of some case law over recent years—the regulation doesn’t specifically address re-filings as being in bad faith or open to proof of use.

Brand owners should therefore consider making strategic re-filings now, at least in relation to core brands. If those are likely to be multi-class applications, they should be made before March 23 (see tip 2).

Tip 6: Docket the right date to oppose international registrations

The nine-month period to oppose international registrations designating the EU has often been seen as unreasonably long. The new regulation shortens this period considerably, to four months. The opposition period will now start running one month after the date of the first re-publication of an international registration designating the EU.

Brand owners need to change their docketing practices to make sure they don’t miss these new shorter opposition periods.

Imogen Fowler is a partner at  Hogan Lovells. She can be contacted at: imogen.fowler@hoganlovells.com